Empowering women through profitable microfinance: A case study of Bandhan

This case study on Bandhan, a microfinance organization, represents a social business. Bandhan provides micro-loans to poor women for undertaking income generation activities. It aims at empowering its borrowers and their family members to break the cycle of poverty. Further, Bandhan projects that it operates as an independent, self sustainable and profitable organization. It aspires to become a full fledged bank, consequently bringing its borrowers to the financial mainstream. Therefore, this case study explores whether and how, focused poverty eradication and ambitious profits are simultaneously possible and if there are any tradeoffs involved. Additionally, a key objective is to explore whether the impact of Bandhan on lives of its borrowers is substantial as well as sustainable. To achieve these, the research involved an in depth field study of Bandhan’s operations and its impact. Both qualitative and quantitative data was collected through primary as well as secondary sources. The key participants in this case study were over 100 women who had taken several micro loans from Bandhan, along with Bandhan employees at various hierarchical levels. The study was conducted in over six districts and 10 field office locations of Bandhan in West Bengal, India, the first state where Bandhan started its operations. The findings of this case study are quite interesting and insightful. The empirical results depict that Bandhan is not only profitable and fast growing but is also quite successful in improving the quality of life of its borrowers. However, it is observed that Bandhan’s dual objective is the underlying reason behind both its effectiveness as well as its challenges. The study also captures several real life cases of the women participants and depicts the impact of microfinance on their economic, capacity and relational well-being.